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UK avoids recession in Q3 but annual growth weakest in almost a decade

Published: 06:24, November 12, 2019

According to the Office for National Statistics (ONS), the UK economy expanded by 0.3% in the third quarter of the year, marking a return to growth after a contraction of 0.2% in the second quarter.

The growth rate in the three months to end-September was just shy of what economists, including those at the Bank of England, had forecast of 0.4%.

In September, the economy contracted by 0.1%. The ONS revised down the contraction in August from 0.2% to 0.1%.

Growth was positive in the third quarter because of a strong July.

The services sector contributed to most of the growth in the quarter, expanding by 0.4% in the three month period, while construction and industrial production added very little.

While the economy may have avoided a technical recession, annual growth dipped to its lowest level in almost a decade.

The annual growth rate comparing the third quarter of 2019 with the same period last year fell to 1%, down from 1.3% in the second quarter.

An ONS spokesman was quoted by the BBC as saying: “Looking at the picture over the last year, growth slowed to its lowest rate in almost a decade.”

The Chancellor, Sajid Javid, said the data was “another welcome sign that the fundamentals of the UK economy are strong. Under the conservatives, we’ve seen nine consecutive years of growth”.

He added: “What it also shows is the real risk to growth in our economy is Corbyn’s Labour. If they get their way, two referendums in 2020, eye watering amounts of spending and borrowing and debt, that kind of economic vandalism will bring growth in this country to a halt.”

By contrast, John McDonnell, the shadow chancellor, said: “Over the last year, growth slowed to its lowest rate in almost a decade.”

He added: “The fact that the government will be celebrating 0.1% growth in the last six months is a sign of how low their hopes and expectations for our economy are.”

 

Christian Nordqvist Avatar

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